India's drug market to 'triple'28th August 2007
India's growing middle class, coupled with rising investment in healthcare facilities and the spread of chronic diseases, will all contribute to a sharp rise in demand for pharmaceuticals there over the next few years, a major consultancy said.
The country's pharmaceuticals market will more than triple to US$20bn by 2015 according to consultancy firm McKinsey.
McKinsey predicts a growth rate that will rank India 10th globally in that year. The country's drug market was rated 14th largest in the world just two years ago, worth US$6.1 billion in 2005 and US$3.4 billion in 2000 in terms of retail sales.
McKinsey's forecast implies a compounded annual growth rate of 12.3%, compared with 9% from 2000 to 2005.
The boom in demand for pharmaceuticals is the result of the growing incidence of chronic diseases like diabetes, heart disease and cancer as more and more people can afford a middle class lifestyle.
These factors would also fuel demand for health insurance and lead to greater corporate diversification and innovation, McKinsey predicted.
One of the main growth areas at the moment is in privately invested corporate hospitals. These will boost the total number of hospital beds and doctors, both of which are expected to double by 2015. This would mean an additional two million hospital beds and an extra 400,000 doctors, it said.
This, however, would also fuel demand for public health professionals, and would also highlight the need for an overhaul of Indian medical training practices.
Health insurance, whose growth has been hampered by a lack of quality facilities, is expected to double by 2015 to cover 220m people, said McKinsey. Indian private hospital chain Apollo and DKV, Europe’s largest private health insurer, this month launched a health insurance joint venture in India.
McKinsey published its report as Swiss pharma giant Novartis announced plans to scale back research and development in India after it lost a controversial court case challenging India’s patent laws.
Meanwhile, the Indian government’s National Pharmaceutical Pricing Authority still operates pricing controls over drugs, which analysts identified as a possible hurdle to future growth prospects in the sector.
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Title: India's drug market to 'triple'
Author: Luisetta Mudie
Article Id: 3846
Date Added: 28th Aug 2007